MANILA, Philippines — Phoenix Petroleum Philippines Inc. of Davao-based businessman Dennis Uy is poised to raise $19.2 million from its divestment in its Singapore-based subsidiary.
In a stock exchange filing, Phoenix said the amount to be raised from the transaction would be utilized to meet the immediate needs of the business for working capital to purchase inventory for its business-to-business customers.
“The added working capital to be raised by the sale shall help push the recovery efforts of the local business, and together with its liability management exercise and any possible equity infusion, the same levels of revenue are expected to be attained in the two to three years along with an increase in margins,” the company said.
Phoenix said the transaction would also offset and settle the outstanding obligations of the company, Phoenix LPG Philippines Inc., Phoenix Gas Vietnam and Udenna Corp. totaling to $24.6 million.
“Insofar as business operations are concerned, there is no impact since mid-2022, Phoenix has been sourcing its inventories from local suppliers,” it said.
Phoenix has announced that it is divesting its investments in PNX Petroleum Singapore Pte. Ltd through the buyback of shares by the latter.
PNX SG is engaged in the trading of petroleum products in the region and services primarily the supply needs of Phoenix.
Phoenix owns about 85 percent equity in PNX SG, while 15 percent is owned by Libra Investments Pte Ltd.
Phoenix said the divestment “is a self help given the difficulty in raising additional working capital bank lines.”
Phoenix losses widened to P2.07 billion in the first half from P62.11 million in the same period last year as lower volume sold during the period slashed revenues by more than half.